Cornerstone Therapeutics (Nasdaq: CRTX) reported revenue of more than $116 million in 2012 but a heart attack drug expected to push the company’s sales even higher in 2013 is being pushed back by two years.
During a conference call to discuss fourth quarter and full-year financial results, Cary-based Cornerstone disclosed for the first time that the Food and Drug Administration declined to approve the supplier of the active ingredient for Retavase, a product that Cornerstone added to its drug portfolio last year when it acquired New Jersey company EKR Therapeutics for $125 million cash. Cornerstone pledged to pay up to $25 million more if Retavase hits sales milestones; the drug supplier was expected to be approved setting the stage for a relaunch of the drug 2013.
Instead, Cornerstone CEO Craig Collard acknowledged Thursday that the FDA issued a complete response letter in December. The agency wants more information about the supplier of Retavase’s active ingredient. Retavase works by activating a substance that breaks up blood clots. With the FDA raising questions about a Retavase supplier, Cornerstone couldn’t sell the Retavase stock it acquired in the EKR acquisition. Cornerstone wrote off $14.6 million worth of Retavase inventory in the fourth quarter.
Collard told analysts that the company is investigating the matter to identify the root cause and the company aims to make new batches of Retavase by the end of the year. But FDA review of the drug’s stability has pushed the Retavase launch timeline to 2015.
Still, Collard tried to put a positive spin on the Retavase situation, saying resolving the drug stability problems now will make it a better product and avoid a drug recall.
“Obviously, once it was on the market, that would have been a real problem,” he said, according to a transcript from SeekingAlpha. “And so I think, in a way, this was a bit of a blessing in disguise.”
Cornerstone did finish the year with $56.3 million in cash and Collard said that more acquisitions could be coming. And soon. Collard said that another deal could come by the next quarter as the company continues to add to portfolio of drug products administered in hospitals.
Cornerstone reported $34.9 million in fourth quarter revenue, a 91.7 percent increase compared to a year ago. But the company’s net loss in the fourth quarter also widened to $6.9 million compared to a $2.7 million loss in the fourth quarter of 2011.
While full-year revenue topped $166 million, the company’s net loss 2012 year grew to $11.8 million.